Rodham & Renshaw to Drop China Research: Report

The boutique investment firm is said to be shutting down coverage of the Chinese companies listed in the U.S. because of waning interest following fraud revelations.

NEW YORK ( TheStreet) -- There's nothing like widespread allegations of fraud and accounting irregularities to diminish investor interest in a particular sector, and that's what's happened with Chinese companies with public listings in the United States.

In fact, the buzz has gotten so faint about China that one of the investment firms known for its coverage of companies from the region, Rodman & Renshaw, is reportedly shutting down its China research operations.

The firm is a unit of Rodham & Renshaw Capital Group ( RODM), whose shares closed Friday at 94 cents, up 7 cents. A company spokesperson wasn't immediately available to comment for this story.

The Justice Department and the Securities and Exchange Commission are both investigating alleged accounting irregularities at Chinese companies, and a number of fraud allegations have sunk Chinese companies that secured public listings in the U.S. through reverse takeovers, as documented in TheStreet'sThe Shanghai Numbers investigative report.

Rodham & Renshaw's Web site still features its research on China-based companies. Among the stocks the firm covers are Advanced Battery Technologies ( ABAT), Origin Agritech ( SEED), Sina Corp. ( SINA), and Zhongpin ( HOGS). The firm lists four analysts as covering China-based stocks.

Shares of Advanced Battery Technologies (Nasdaq:ABAT) have taken a tremendous swing upward. The stock is trading at $1.55 as of three p.m. ET, 20.2% above Friday's closing price of $1.29. Volume is at 3.1 million, 1.2 times the daily average of 2.6 million.